For industry survivors to meet the Bush administration's ambitious energy goals, powerplant contractors need a robust industry. They need collaborative agreements with project owners instead of today's adversarial, risk-shifting, lump-sum, engineer-procure-construct, EPC contracts. Fortunately, an excellent model of collaboration exists--outside the powerplant sector.
ALLIANCES. In the oil-and-gas sector, pre-merger British Petroleum Co. PLC turned around a bad situation. About 10 years ago, its dealings with contractors and suppliers suffered from name-calling, out-of-control schedules and bitter litigation to settle claims. Determined to build projects cooperatively, BP overhauled its contracting culture from top to bottom and introduced an innovative contracting method called project alliance contracting.
